Terrains Financing
Financing for the Purchase of Terrains
The purchase of a financed terrain is the solution for many people who wish to build and cannot afford all the works.
The interest rates charged in the financing for the purchase of terrains are higher than those practiced in the real estate financing.
There are two manners to finance a terrain: by means of the financial system (banks and financial institutions) or directly by means of the incorporator.
Financing of Terrains By Means of Banks
Few banks provide financing for terrains. The main bank that provides that is Caixa Econômica Federal. The rates charged are approximately 15% p.a., higher than the rates charged for the financing of finished properties.
The market conditions are usually the following:
- It is not allowed to use the Government Severance Indemnity Fund for Employees (FGTS) for financing terrains
- In order to purchase a financed terrain, the maximum commitment of the income is 30%. That is, if you make R$ 2.000,00 the installment of the terrain financing cannot be higher than R$ 600,00.
- Maximum repayment term in the purchase of the financed terrain of 180 months
- SAC repayment system
- There is no maximum amount for the financing
- Rates: from 12,50% to 16%, depending on the financial institution
- Pré-fixed or post-fixed rates (+TR)
Financing of Terrains with the Incorporator
Another way to finance a terrain is directly with the condominium incorporator. This is valid when the undertaking is being launched, and the incorporator is interested in selling the units as quickly as possible.
For the incorporator, to finance a terrain for the purchasers is an excellent deal. He can get an interest rate way above the market, which is already embedded in the sales amount. For instance, if a terrain costs R$ 20.000,00 the incorporator asks for 30.000,00 and says that you can pay within 36 months with no interest rates.
Make a test and say that you are not interested in buying a financed terrain, but in paying in cash. Few will be interested in selling.
The real interest rates for terrains financing in that kind of undertaking easily gets to 20% p.a.
Tips for Terrains Financing
- The rates and conditions for financing terrains and urbanized plots offered by Caixa are better than any other Bank's. Choose Caixa, but do not forget to consult other banks.
- Think about opening an account at Caixa when financing a terrain, because the conditions are better for an account-holder than for a non account-holder.
- Do not commit more than 15% of your income in the terrain financing
- Do not overextend the terms of payment of the financing of the terrain, because the interest rates charged are very high. Use it as a purchase option of your second property
- There is a rate charged monthly in the installment of the terrain financing, which varies from R$ 25 to R$ 50. Take it into account